Zaremba Center for Estate Planning & Elder Lawtag:typepad.com,2003:weblog-866811927500285552016-12-08T10:04:00-08:00Your Dreams, Our Knowledge...Creating Estate Plans that Work!TypePadIf It’s Not in the Will Then There’s No Way… tag:typepad.com,2003:post-6a0133f415c7cd970b01b7c8b90e66970b2016-12-08T10:04:00-08:002016-12-08T10:04:00-08:00…For a Pennsylvania woman to get a dime from the estate of her long-time lover. That’s because he didn't name her in his will, says the Pennsylvania Court of Appeals. That ruling affirmed the decision of the trial court—it didn't buy Carol Galinac's argument that she and Ralph Tito were...Walt Zaremba

…For a Pennsylvania woman to get a dime from the estate of her long-time lover.

That’s because he didn't name her in his will, says the Pennsylvania Court of Appeals. That ruling affirmed the decision of the trial court—it didn't buy Carol Galinac's argument that she and Ralph Tito were common-law husband and wife when he died in September 2013. The decision which leaves Galinac empty-handed came in an opinion Judge Anne E. Lazarus issued last week. The decision of the Court of Appeals upholds the ruling by a Westmoreland County judge who honored a request by Tito's four children to dismiss a claim Galinac filed against their father's estate.

Judge Lazarus’ ruling found that Tito and Galinac had been in a romantic relationship for 13 years when Tito died, but that only Tito's kids were named as beneficiaries in his will. The will provided nothing for Galinac, the judge noted. Galinac claimed that Tito's children were keeping her from even retrieving her property from Tito's home. In reply, Ralph Tito's kids demanded that she give back thousands of dollars they claimed she withdrew from his checking account. The children also argued that a cohabitation agreement Galinac signed, barred her from making claims against the estate.

On appeal, Galinac argued that the trial judge Lazarus erred in deciding she had waited too long to contest Tito's will. Judge Lazarus should have allowed her the opportunity to prove she and Tito were common-law spouses, Galinac argued. She also insisted that Tito's children misled her by telling her she was "merely (Tito's) girlfriend" and, as a result, had no legitimate claim to his estate.

Judge Lazarus found Galinac's arguments to be "illogical, irreconcilable and legally untenable," which sunk her chances of success in court. The judge noted that she claimed she had a common-law marriage on one hand, and yet on the other hand said she didn't know if she and Tito were legally wed. Like Virginia, Pennsylvania doesn't recognize common-law marriages. In any event, Judge Lazarus explained that both parties were required to acknowledge the common-law bond existed. If there wasn’t mutual agreement, there wasn’t a legally binding union that would entitle Galinac to a share of Tito's estate.

Pay It Forward in Your Estate Plantag:typepad.com,2003:post-6a0133f415c7cd970b01b8d242c836970c2016-12-07T10:01:00-08:002016-12-05T13:46:23-08:00University of Kentucky’s Alumnus Craig Adams plans to use his estate plan to fund the lapsed scholarship program that enabled him to go to dentistry school. When Craig Adams was in high school, his father said he should think about dentistry as a profession. Adams took his dad’s advice seriously....Walt Zaremba

University of Kentucky’s Alumnus Craig Adams plans to use his estate plan to fund the lapsed scholarship program that enabled him to go to dentistry school.

When Craig Adams was in high school, his father said he should think about dentistry as a profession. Adams took his dad’s advice seriously. After graduating from dental school, Adams went on to build a very successful dental practice. Along with his dental practice, Adams serves as a member of the adjunct clinical faculty at the University of North Carolina School of Dentistry and the community faculty of the University of Kentucky College of Dentistry.

With gratitude for his UK education and a desire to help students follow his same career path, Adams made the largest gift commitment in the history of the College of Dentistry. “Dental school is expensive,” he said. “Nationwide, today’s students are graduating with an average debt of $250,000. I know I can’t help all of the students pursuing dentistry at UK. However, by endowing a scholarship, I can help one or two students per year, every year, for many years to come.”

Adams contacted UK’s senior director of Gift and Estate Planning to help him map out the parameters of the scholarship endowment he wanted to create and to fund it in a tax-wise manner. Adams made a “hybrid gift,” establishing an endowed scholarship to be funded with both outright gifts during his lifetime and deferred gifts through his estate plan.

This allows Adams to consider the details of how he wants the scholarship to work and gives him the opportunity to see his philanthropy at work as scholarship grants are made.

In total, Adams’ gift commitment is more than $3 million, which makes it the largest in the UK’s College of Dentistry’s 54-year history. Does this sound like something you’d like to do? Making an appointment has never been easier, simply request a consultation online or call our office to schedule this complimentary meeting.

New Types of Life Insurance May Be Just What the Doctor Orderedtag:typepad.com,2003:post-6a0133f415c7cd970b01b7c8b9014b970b2016-12-06T10:06:00-08:002016-12-05T13:10:59-08:00The concept of leveraging your assets and maximizing your estate with life insurance is a common strategy that has been used by many retirees for decades. If you do this the right way, the purchase of one of the new forms of ‘hybrid life insurance’ can be a great estate...Walt Zaremba

The concept of leveraging your assets and maximizing your estate with life insurance is a common strategy that has been used by many retirees for decades.

If you do this the right way, the purchase of one of the new forms of ‘hybrid life insurance’ can be a great estate planning tool to own within a portfolio of investments. This strategy is so named because with a hybrid life insurance policy the insured doesn’t have to die to use the policy’s death benefit. The insured’s death benefit is calculated by the amount of the one-time deposit, age, gender, and health. In some instances, the single deposit can be multiplied by two or more when determining the policy’s guaranteed death benefit. Therefore, a non-smoking female in average health who contributes $100,000, could see an immediate $200,000 tax-free death benefit. That death benefit can be given to the heirs of her estate without going through probate, as the assigned beneficiaries to the policy. That lets the insured transfer her wealth tax-free and up the amount her beneficiaries will inherit. Insurance companies that write this type of policy may give you an option to accelerate the policy’s death benefit to use for chronic illness and long-term care expenses.

If an individual has bank savings accounts, CDs, money market accounts, brokerage accounts, and even annuities and is keen on the idea of being able to always have access to their money, they should know that some hybrid policies guarantee a 100% return of premium. Other policies allow withdrawals of the policy’s cash value.

Many hybrid policies have growth based on either fixed rates of interest or an indexed rate of interest. This can be much better than a savings account, CD, or an annuity. These added benefits make hybrid life insurance an ideal alternative to depositing cash in the bank.

Some folks over age 65 have the common misconception that the required underwriting process is burdensome and requires perfect health in order for them to qualify. That’s not so in this case because simplified underwriting makes getting qualified quite easy. There’s no medical exam or blood test required. Advanced underwriting and technology that’s been adopted by insurance carriers expedites the approval process. It requires just a few medical questions and a short phone interview.

Hybrid life insurance can be a worthwhile estate planning tool with tax benefits and favorable guarantees. However, it does have its pluses and minuses. You should, therefore, work with a competent estate planning attorney with the knowledge and experience to help guide you with this estate planning tool.

Are Your ‘Living Estate Planning Documents' in Order?tag:typepad.com,2003:post-6a0133f415c7cd970b01bb095bea61970d2016-12-05T10:05:00-08:002016-12-05T15:42:47-08:00These are documents that everyone over the age of seventeen needs in order for your loved one to assist you no matter what your future has in store for you. Estate planning attorneys advise you to make your estate plan for any situation that might arise. Therefore, a good estate...Walt Zaremba

These are documents that everyone over the age of seventeen needs in order for your loved one to assist you no matter what your future has in store for you.

Estate planning attorneys advise you to make your estate plan for any situation that might arise. Therefore, a good estate planning attorney will guide their clients through myriad “what-if’s” that may or may not occur many years in the future. If you get hit by a bus, you might die or you might not, so you need a portfolio of ‘living documents.’ In addition to a will and/or a trust, the documents should include the following:

Power of Attorney. Signing this document means that you give a trusted agent the power to act on your behalf if you become incapacitated. You can also create two separate powers of attorney: one that gives authority to a business partner to make decisions concerning your farm or company; and one naming a spouse or family member to handle your personal finances.

Living Will. This document states your intent that, under certain circumstances, you want medical efforts to be withheld or withdrawn and that you want to be allowed to die naturally with only medication and procedures necessary for comfort and to alleviate pain. A living will can reduce some of the stress and burden from family members, in the event that they have to make an end-of-life decision.

Advance Medical Directives. In Virginia, this set of documents refers to the Healthcare Power of Attorney, the Living Will and the HIPAA release. It might be one document, but we do not recommend this format because of the diversity of intentions each document expresses.

Health Insurance Portability and Accountability Act (HIPAA) Release. When a loved one or agent needs to access your otherwise private medical records, he or she needs to have your HIPAA release that authorizes him or her to have access to your medical records. This eliminates any bureaucratic red tape or delay if someone needs to make healthcare decisions.

This set of documents is critical to creating a comprehensive plan and to prevent unneeded stress on your family. We have made the process of requesting a complimentary consultation to discuss the planning needed to navigate the issues you will face as easy as possible. We can help.

Integral Component for an Entrepreneur’s Estate Plan tag:typepad.com,2003:post-6a0133f415c7cd970b01bb0958a119970d2016-12-02T10:02:00-08:002016-11-29T07:27:32-08:00Many entrepreneurs have their noses to the grindstone and a laser focus on growing their companies. What are they missing? A working succession plan. While they’re working hard at it, many small business owners fail to consider what will happen if they are injured in an accident, suffer an illness,...Walt Zaremba

Many entrepreneurs have their noses to the grindstone and a laser focus on growing their companies. What are they missing? A working succession plan.

While they’re working hard at it, many small business owners fail to consider what will happen if they are injured in an accident, suffer an illness, or die suddenly. These business owners who don’t take the time to create an effective estate plan risk undermining a lifetime of hard work, jeopardizing the jobs of their staff, and endangering the future of their loved ones.

Here's a list of important estate planning essentials for the business owner:

A Will. This is the most basic estate planning document. It lets a person or a small business owner say how his or her assets will be distributed and to whom. A will also allows the person creating the will to name a personal representative or executor to be responsible for managing and disbursing the personal and business assets according to the testator's wishes. If the business is a sole proprietorship, the executor or a trusted family member should be given access to digital assets like online banking, email, and the company website. This should be a separate document from the will because a will is a public document filed in probate court.

Power of Attorney. This designates a person to handle the business affairs, if the owner becomes incapacitated. If you don’t have this, the court will appoint a guardian to manage the affairs—and his or her decisions may not jive with the business owner's wishes. It could also cause conflict with the other parties.

Trusts. A will, again, is a public document and is required to be probated in court. That can cause issues for a small business wanting to protect sensitive information. As a result, a business owner may want to consider a revocable living trust. This trust takes title to property but lets the creator of the trust or the trustees continue managing the assets during his or her lifetime. Because it’s "revocable," it can be modified. A trust can avoid probate, transfer assets to beneficiaries privately and quickly, and allow a business to continue operating.

Buy-Sell Agreement. A buy-sell agreement is critical for partnerships or companies with just a few owners. This document establishes a way of distributing an owner's interest if he or she dies or becomes disabled. It is also helpful if an owner declares bankruptcy or is going through a divorce. The buy-sell agreement will also detail how to value the business.

Succession Plan. An entrepreneur’s comprehensive estate plan should include a formal, written succession plan, which provides for the seamless transition of the business. A comprehensive succession plan will state how ownership will be transferred, establish rules for hiring, compensating and promoting family members, and detail how disputes will be resolved.

An estate plan is a must for an entrepreneur. If you fail to have a plan that enables the business to continue operating, then your partners and family members will have an extremely difficult time trying to manage the business assets … and the disputes that will no doubt arise. Hire an estate planning attorney to establish a course for the future.

Yours, Mine and Ours: Estate Planning for Blended Familiestag:typepad.com,2003:post-6a0133f415c7cd970b01b7c8b58b7b970b2016-12-01T10:03:00-08:002016-12-01T10:03:00-08:00Estate planning can be very complex with a blended family, so ask for help from a qualified estate planning attorney. Everyone needs estate planning but it can be especially vital if yours is a so-called blended family with whom none of the various members have a close relationship with the...Walt Zaremba

Estate planning can be very complex with a blended family, so ask for help from a qualified estate planning attorney.

Everyone needs estate planning but it can be especially vital if yours is a so-called blended family with whom none of the various members have a close relationship with the other members. Here are a few general ideas to help you think about your blended family:

Update Beneficiary Designations. Get all of your beneficiaries set and updated, like those on your retirement accounts and insurance policies. This will ensure that they reflect your blended family. It is important to remember that these designations take priority over the instructions in your will—it’s a totally separate deal.

Living Trust. While you’re at it, consider a professional trustee for a living trust. Trusts can help you to avoid probate and allow you the freedom to decide how and when you want your assets distributed. After you pass away, a properly created trust can provide a surviving spouse with income for life. After he or she dies, it will then give the children from an earlier marriage the remainder of the trust assets. To be fair to all, you may want to hire a professional third-party trustee who isn’t a beneficiary of the trust and isn’t entitled any of the trust assets. This person or company wouldn’t have a vested interest in how proceeds of the trust are distributed.

Prenuptial Agreement. When settling an estate, a prenuptial agreement can help eliminate disputes among members in a blended family. With a pre-nup, you can detail a separation of property for your will, your living trust, and any other relevant estate-planning arrangements in the event that you and your new spouse agree to keep your assets separate so you can each pass an inheritance to your own children.

Finally, be sure to share your estate-planning intentions with the members of your blended family. This can help prevent bad feelings and unpleasant surprises.

Create an Estate Plan Now That Prevents Family Fighting Latertag:typepad.com,2003:post-6a0133f415c7cd970b01b7c8b51aa2970b2016-11-30T10:03:00-08:002016-11-30T10:03:00-08:00It’s not uncommon for parents to be mediators between their children. But after they pass away, siblings can battle more frequently and more aggressively. The challenges of maintaining family relationships are that much greater when money is involved. Added stress is present when blended families can’t trust one another and...Walt Zaremba

It’s not uncommon for parents to be mediators between their children. But after they pass away, siblings can battle more frequently and more aggressively.

The challenges of maintaining family relationships are that much greater when money is involved. Added stress is present when blended families can’t trust one another and don’t get along. You might be surprised at the amount of money that can cause arguments. It doesn’t have to be a fortune—deep-seated feelings of rivalry and jealously are, in many instances, at the root of the problem. With that in mind, let’s look at four ideas to consider in an attempt to avoid a battle royal over your assets:

Irrevocable Trusts. When the parents are both alive, they can consider a trust. Irrevocable trusts can’t be modified by the children or even the surviving spouse. They will protect the aging parents from themselves. They also can let the children know that other beneficiaries can’t inflict undue influence.

Preplanning. Don’t force family members to make financial decisions during a family crisis. Consult with an estate planning attorney to talk about how to best address your specific situation.

Hire a Corporate Trustee. This can alleviate the scenario of children being pitted against one another. A trustee can be appointed to be responsible for administration. If you name one family member as a trustee for the other family member, it places the family in a precarious situation if there’s a disagreement about how the trustee is managing the trust. A corporate trustee can manage investment accounts, businesses, farms, and real estate. The costs of a trust company might be a small price to pay for keeping peace in the family.

Have a Family Conference. The family should meet, especially if the parents decide that “fair doesn’t mean equal.” It’s hard to explain how and why an estate will be distributed in a will or a trust. A face-to-face discussion is the best way to address any issues. A family meeting to talk about estate planning, with an experienced estate planning attorney to lead the process, can help keep peace in the family.

Incapacity and Youtag:typepad.com,2003:post-6a0133f415c7cd970b01b8d23ee568970c2016-11-29T10:01:00-08:002016-11-29T10:01:00-08:00Incapacity planning is about designating how you want to be cared in the event that you lose your cognitive ability. As hard as it is to think about one’s own incapacity, it is absolutely necessary because a failure to plan now means that loved ones will undoubtedly be creating a...Walt Zaremba

Incapacity planning is about designating how you want to be cared in the event that you lose your cognitive ability.

As hard as it is to think about one’s own incapacity, it is absolutely necessary because a failure to plan now means that loved ones will undoubtedly be creating a plan when their focus would otherwise be on you and the care you require. The problem is that most people don’t give much thought to the issue until it is too late to do it correctly. That means added expense.

Let’s look at some important lessons about incapacity planning:

Inform your surrogates and agents about your wishes immediately. You should also explain your thought process to them so they have complete information to carry out your wishes if necessary. What often happens is that Dad has a fall or an illness that puts him in rehab. The family reacts by shifting into crisis mode, and they make important decisions relying on the information readily available instead of the complete picture.

Select some strong surrogates. These are agents or advocates to whom you grant durable power of attorney. They will have control of your welfare. This includes handling your finances and paying your bills. Therefore, in addition to having great trust in your surrogates, you have to be sure that they’re able to manage your finances. Discuss the day-to-day administrative and financial tasks that they may need to monitor for you. Some people will divide the responsibilities into two jobs: a healthcare surrogate who will decide your medical decisions and a financial power of attorney to maintain focus on your financial affairs.

Don’t give a child who’s emotional and fragile the responsibility of ending medical care that will end your life. Many people select a child as their medical surrogate, but he or she may not be the one best-suited emotionally to make tough medical decisions. That involves decisions about withdrawing life-prolonging procedures or the intake of food, if the situation arises. That can be a huge emotional challenge.

Tennessee Will Contesttag:typepad.com,2003:post-6a0133f415c7cd970b01bb09581e0d970d2016-11-28T10:07:00-08:002016-11-28T11:58:44-08:00A 110-year legal decision known as ‘the Cowan rule’” has effectively stopped five of J. Don Brock’s children from winning their will contest. After their father’s death in March 2015, five Brock siblings claimed that their father's second wife and former secretary, Sammye, teamed up with her two children from...Walt Zaremba

A 110-year legal decision known as ‘the Cowan rule’” has effectively stopped five of J. Don Brock’s children from winning their will contest.

After their father’s death in March 2015, five Brock siblings claimed that their father's second wife and former secretary, Sammye, teamed up with her two children from a previous marriage (who Brock had officially adopted as well) to exclude them from a 2013 will.

At the center of this will contest is a very old law that seemingly has plagued many modern day Tennessee judges because of it does not allow for any extenuating circumstances to be considered. The Cowan Rule is a 1906 Tennessee Supreme Court decision which holds that a descendant who was left nothing in an earlier, un-probated will has no standing to contest a later will. In other words, you can't contest the final will if you weren't left anything in a previous will. That was the verdict in February, 2016 when the trial court judge reluctantly dismissed the five siblings' claim for that reason: they didn’t have standing to contest the 2013 will because they weren't included in a 2012 draft.

The Tennessee Court of Appeals recently upheld the lower probate court’s decision although they too seemed somewhat to be somewhat frustrated by the Cowan rule's rigidity that would not allow any other evidence to be considered. For example, as the children’s attorney pointed out in their argument before the court, J. Don Brock had created numerous wills over the years and those wills cut out all of his children at different times.

"Tennessee law does not appear to provide a mechanism by which a contestant can challenge multiple prior wills when the contestant is excluded from those wills," Judge Brandon Gibson wrote for the court. "The Tennessee Supreme Court is free to re-visit its rulings in Cowan (1906) and Jennings (1966), and we encourage an examination of their practical application."

Richard Bethea, the attorney representing Brock's estate, said: "This isn't some draconian measure to protect rich people from doing things they shouldn't do. The whole purpose of the rule is to prevent someone from filing the will contest and basically trying to shake down the estate, to get money out of an estate, and delay the disposition of the estate through litigation."

Rosenbach Museum and Library Lose Legal Battletag:typepad.com,2003:post-6a0133f415c7cd970b01bb0955c87c970d2016-11-25T10:01:00-08:002016-11-25T10:01:00-08:00Author Maurice Sendak’s estate has won in a legal battle with the Rosenbach Museum and Library in Philadelphia. The museum was the repository of thousands of his original drawings and parts of his book collection before his death in 2012. But a Connecticut probate court judge awarded most of the...Walt Zaremba

Author Maurice Sendak’s estate has won in a legal battle with the Rosenbach Museum and Library in Philadelphia. The museum was the repository of thousands of his original drawings and parts of his book collection before his death in 2012. But a Connecticut probate court judge awarded most of the disputed book collection to the Sendak estate, rather than the museum.

Most of the items, on loan to the Rosenbach for decades, must now be returned to the heirs of the Sendak estate. Many in the museum world expected that the Sendak material would remain there. However, Sendak’s will said the drawings and most of the loans would remain the property of the Maurice Sendak Foundation. In 2014, representatives of his estate withdrew the works, explaining that they intended to follow Sendak’s directive in his will to create “a museum or similar facility” in Ridgefield, Connecticut, where he lived, and where his foundation is based, “to be used by scholars, students, artists, illustrators and writers, and to be opened to the general public” as the foundation’s directors saw fit.

In 2014, the Rosenbach sued in Connecticut state probate court, claiming that the estate kept many rare books Sendak had pledged to the library in his will—including two highly valuable books by William Blake and Beatrix Potter. The judge ruled that the Blake illuminated works, which could be worth millions of dollars, didn’t fit Sendak’s specific language in his will that the museum should receive “rare edition books.” The estate claimed that the Blake pieces were not edition books, but rather were more like unique works.

The museum argued that the books fit the will’s description, but that Sendak’s executors wanted to sell them to pay themselves executors’ fees, legal fees, and fees for serving as directors of Sendak’s foundation. But earlier this year, the judge ruled that Sendak’s Beatrix Potter books—which the estate wanted to keep—belonged to the museum because they fit the description of “rare edition” books in the will. Of the 340 items left in dispute, the judge awarded 88 to the Rosenbach and 252 to the estate and foundation.

Jeffrey T. Golenbock, a lawyer who represented the estate in the case, said the foundation had no intention of selling the works it had retained but planned “to keep them as part of the collection” as a way “to honor Mr. Sendak.” The foundation’s progress toward the opening of a Ridgefield museum has been slow.